The Senate has blocked the government’s plan to strip older Australians of the extra rebate they receive on their private health insurance, a change that would have pushed up premiums for around three million people aged 65 and over.
On Oct. 14, Coalition, Greens and crossbench senators voted 38-23 to remove the government’s bill from the Senate’s list of business, meaning it cannot be debated or passed unless the government brings it back.
The motion was put forward by Tasmanian independent Senator Jacqui Lambie and the Coalition’s health spokeswoman, Senator Anne Ruston.
Lambie said public hospitals were already under heavy strain and that the funding for aged care should come from somewhere else.
“This would have finished our public hospitals off,” she said. “Go find some money.”
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Ryan, who led opposition to the bill in the lower house, said, “It was wrong. It wasn’t transparent. It was not fair.”
How the Rebate Works
Currently, the government subsidises part of the cost of a person’s private health insurance, with the amount based on both income and age.
For those in the lowest income tier, this would mean a reduction of about four percentage points for people aged 65 to 69 and eight percentage points for those aged 70 and over.
The government expected to save about $3 billion (US$2.1 billion) over four years.
Response from the Coalition
Liberal Senator James Paterson said the vote had left Butler “in a very embarrassing place.”
“His signature budget savings measure has just blown up in his face,” he said. “And so it should have, given how cruel it was to older Australians.”
But Butler said after the vote that the government would reintroduce the same bill on Oct. 15.
The minister also said the government had been willing to consider changes to the bill in good faith but was not given the chance, and accused the new leadership of the Greens of walking away from negotiations.
Asked about exempting pensioners, Ruston said the Coalition “would very, very much welcome pensioners continuing to get the rebate,” but argued that all eligible people over 65 should keep it.
Paterson said the Coalition would keep opposing the bill and warned the Labor government’s decision to bring it straight back would backfire.
“In my experience, if you show contempt for the Senate, that contempt is returned, and so it should be in this case,” he told News24.
“Unless the Greens buckle, that’s the only issue. We are not for moving,” he said.
Butler has defended the change as a matter of fairness between generations, arguing that two households on the same income should get the same help with their health insurance, regardless of age.
